That's Oil, Folks

The oil-spill disaster in the Gulf appears inevitable in hindsight

The more we learn about the BP oil-well blowout in the Gulf of Mexico, the more we ought to question the basic assumptions that led us here. Like the explosion of the housing bubble that ruptured the world economy, this human and environmental tragedy resulted from a system that encourages reckless profiteering without effective regulation.

It is impossible to understand why an accident like the Deepwater Horizon disaster was inevitable without looking back on an era when the energy industry dominated government. The oil bidness, as it is known affectionately in Texas, could do no wrong under the Bush-Cheney administration, which was run by former oil executives and their lobbyists. Remember that among the top priorities of the secretive energy task force run by Vice President Dick Cheney was relief for Big Oil from "burdensome" environmental regulations.

Countries that impose strict oversight on their energy sectors are exemplary in protecting worker and environmental safety.

As The New York Times reported recently, the Washington zeal for deregulation let offshore oil drilling proceed virtually without interference from government, even though scientists and engineers repeatedly raised safety and environmental concerns over the past decade. Warned specifically that the blowout-prevention technology drillers were relying on to prevent an explosive spill was faulty as long ago as 2000, the oil industry did nothing except to drill deeper.

As for the Mines and Minerals Service, the Interior Department agency responsible for overseeing the drilling operations, it did nothing, either — except to reduce its inspections of safety equipment. Presumably, the MMS failed to act because it was infested with crooked officials who took drugs and engaged in sexual relationships with oil industry personnel — and accepted bribes from them, too. The oil industry was allowed to drill, baby, drill wherever it wanted, often without even paying royalties to the federal government.

But the culture of American government, from the executive branch to Congress and even the judiciary, has been infected with a disease deeper than corruption: an ideological deference to corporate power, in the name of "free markets" and efficiency, that enriches a wealthy few at the expense of the nation. While this pattern can be detected across many sectors of the economy, its effects are now felt most acutely in the financial and energy sectors, whose power over government is legendary.

Such an imbalanced system encourages financial firms to take enormous risks, pocket the profits, and let the taxpayers, workers, and communities suffer the consequences. And the same system encourages oil companies to take enormous risks of a different kind, resist strict environmental requirements, book huge profits — and then let the rest of us cope with the consequences of their devastating pollution (although we can hope that BP will pay for at least part of the Gulf cleanup).

Free-market ideologues and other corporate shills insist that this is the most efficient way to do business, which is true enough for a corporate manager or a stockholder. But it isn't very efficient for the nation whose public wealth, natural resources, and future prosperity are depleted by these ruinous practices.

In America, we have been told for more than three decades that there is indeed no other way to run an economy — and certainly not if we wish to preserve our traditional freedoms. But looking around the world, it's easy to see through those old platitudes. Countries that impose stronger regulation on their financial sectors did not endure the same kind of disruption we did and emerged more swiftly from the recession. Countries that impose strict oversight on their energy sectors, including offshore drilling, are exemplary in protecting worker and environmental safety.

The world's best record on offshore oil is enjoyed by Norway, a free and democratic country where North Sea oil provides not only a major source of employment but the funding for universal health care, education, and a panoply of other important benefits. In Norway, oil drillers are expected to implement the most advanced systems of environmental protection. That's because the Norwegian people own the oil, and the oil men answer to them.

Joe Conason writes for the New York Observer and Salon.com, where this column first appeared.